GBP/USD: BoE Dented Demand For Pound

The pound euro (GBP/EUR) exchange rate is rising, recouping losses from yesterday.

The pound is hovering around a 5-month high ahead of the BoE interest rate decision. The central bank is expected to hike rates by 25 bps to 4.5% and could leave the door open for further rate hikes, given that inflation is still above 10%.

The euro is falling despite a hawkish sounding ECB. ECB President Christine Lagarde reiterated that the central bank still had more work to do to tame inflation.

There is no high impacting eurozone data due. Instead attention will be on ECB policy maker Isabel Schnabel who is due to speak.